Gord,
It looks more like a wood-staining fungus got to it.
When was the construction & landscaping done?
The tree was probably stressed by all the changes and its roots impacted by the activities and trucks, etc.
Supposedly the fungi spores are carried by beetles or the wind or rain and enter through wounds.
Stressed trees can't keep the fungus at bay and so it spreads quickly.
Also, since the people said the tree wasn't doing well and that's why they started watering it shows that something was already amiss.
Too bad...and it might have been preventable with a protection zone created around the tree during the construction phases.
-Diane-